customer.

Account Planning, Management & Development



As markets tighten and market competition

increases, it becomes increasingly difficult for companies to achieve

product differentiation in their market place. As such, businesses will

find it harder and harder to optimise their profits unless they develop

effective strategies to achieve differentiation. One way to accomplish

this is through the enhancement of customer intimacy.

Account Planning, Management & Development is the process that

organisations adopt in order to prioritise their customers in terms of

value to the business. In most businesses, the 80/20 rule applies where

80% of current and/or potential revenue comes from 20% of the customer

base. However, in recognising the value that these 20% of customers

hold, it is important to adopt a strategy that is going to ensure that

they are handled in such a way that maximum effort is focused on the

activities that will yield the greatest potential for the company in a

profitable fashion.

Successful Account Planning, Management & Development ensures

that a company recognises the importance of certain customer

relationships to the future of their organisation and treats these

relationships as an asset to the company.

The process used to categorise customers in terms of potential as

well as the process adopted to manage and develop these customers

effectively are paramount to the success of any Account Planning,

Management and Development strategy.

So what is a Key Account?

Essentially, it is a customer who can help to shape your company’s

future. This may not necessarily be your largest customer nor the

highest spending customer. In this way, the top 20 revenue,

one-size-fits-all approach can be costly and risky.

Once you have completed your customer research, a number of factors

should be assessed when deliberating your Account Planning, Management

and Development strategy:



  • Current revenue profitability vs. potential revenue profitability


  • Complexity of needs


  • The industry in which they operate and its viability


  • Financial stability




Although the process of developing and managing Key Accounts more

intimately yields greater customer penetration or share of wallet, the

costs of maintaining an intimate relationship with clients can also be

costly. It is for this reason that the ‘biggest’ clients do not always

make the ‘best’ clients. It is a common mistake for organisations to

simply segment their customer base into key accounts based on their

revenue contribution, consider:



  • Larger companies often require more attention and expect not to pay for it


  • Larger companies tend to exert their power and negotiate lower

    prices, often exploiting suppliers by creating price wars (thus

    reducing profitability)


  • Larger companies employ the resources of smaller suppliers, only

    giving them small orders but getting the lowest prices so they can

    squeeze on their larger suppliers (again, affecting profitability)




It is often a hard lesson for salespeople to learn that many big

companies rarely provide the return on investment proportionate to the

amount of effort that’s required. In addition, these customers often

compromise the company’s profitability significantly.

Analyse your accounts

So you need to analyse your accounts carefully. When analysing an

account, your core focus is to interpret the customer data in such a

way that will provide you with an understanding of how you can yield

maximum potential from the client.

There are five key areas that need to be researched:

Strategic Information

This is the big picture information it explains why they are in

business and where they are headed as an organisation. This information

is critical to your basic understanding of the company.

Operational Information

The nuts and bolts of the organisation, the what, the when and the where.

Financial Information

This information is critical in assessing the ongoing viability of the customer.

Competitor Information

Recognise their strengths and minimise them. Recognise their weaknesses

and exploit them. Understand what they are doing and know how to combat

their activity.

Your Company History

Have a basic understanding of previous dealings with the customer but

also know where to find more detailed records if or when required.

I hope this helps you plan and use your selling energy wisely.

Happy selling

Author:.

'Selling is everybody's business and everybody lives by selling something' so says Sue Barrett, sales expert, writer, business speaker and adviser, facilitator, sales coach, training provider and entrepreneur. Sue founded Barrett in 1995 to positively transform the culture, capability and continuous learning of leaders, teams and businesses by developing sales driven organisations that are equipped for the 21st Century. Since inception, Barrett has worked with hundreds of Australian companies c...

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